Tuesday, January 15, 2013

Germany Wants It's Gold Back; NASDAQ Negative Since Jan. 2; America: A Nation of Sleeple

The biggest financial news of the day was not carried by the Wall Street Journal, CNBC or Bloomberg (over the air, at least), but by German newspaper Handelsblatt (in German) and initially picked up by GATA and, naturally, ZeroHedge.

After months of pressuring from the public, the report tells of how the German Bundesbank is planning to repatriate much of its gold reserves, of which only 31% is held in Germany.

The New York Federal Reserve holds 45% of Germany’s gold reserves. The Bank of England and the Bank of France hold 13% and 11% each, respectively.

These arrangements date back to the 1950s, when Germany was split into East and West countries, as a precaution, but, since Germany has been whole for some time now, the government believes it is prudent to bring most of the reserves home.

Though details have yet to emerge, the plan calls for repatriation of all gold from France, since there would be no forex advantage, both countries under the regime of the same currency, the Euro. Estimates are that the Germans will kindly ask the Federal Reserve and the Bank of England for most of their reserves, especially after President Obama intoned yesterday that America is not a "deadbeat nation" (we are).

Nitwit traders on Wall Street scarcely understand the importance of this gesture by the Germans. They have (or think they have) the second largest hoard of gold in the world; only the USA has more in actual, physical reserves.

Germany may also be concerned that all of their gold is not where it is supposed to be or has claims against it, as central banks have played fast and loose with gold over the years, often leasing it out on speculation. There's also a fear that some of the gold bars may actually be counterfeit. A number of tungsten-filled bars have been showing up in odd places of late.

One cannot reasonably blame the Germans for wanting a full, accurate accounting of their owned wealth and to have it in their possession. This is a huge development, signaling that Germany, the strongest country in the EU, may be planning to disengage from the Euro and reinstitute and re-establish the Deutschemark as their official currency.

In such a case, nations like Spain, Greece, Italy, Portugal and pretty much the entire Eurozone nations would be toast and the game of international currency debasement would enter a new, dizzying phase with unknown consequences.

Stay tuned on this one.

As reported here yesterday, the NASDAQ index was holding onto a five-point gain since the huge 92-point ramp-up January 2nd, and today finished below that threshold. As of the close today, the NASDAQ is down one point and change. So, if you missed the move on the NAZ on January 2nd, you're down for the year so far. Too bad.

Amazing. With the Fed pumping in $85 billion a month with daily POMOs and all the MBS available, they still can't put together a decent gain? Curious. All this money seems to be going into a black hole.

Reporter and editor of this blog, Fearless Rick (yeah, that guy over there on the duvet having a beer) has coined a new term which he believes covers about 75% for the American population: SLEEPLE, defined as people who look and act like they're awake, but are actually sleeping.

Credit due. Per aspera ad astra. Caveat Emptor. ©

BYW: This looks like a good spot to go short just about anything, but especially tech and, among that group, just about anything related to social media.

Dow 13,534.89, +27.57(0.20%)
NASDAQ 3,110.78, -6.72 (0.22%)
S&P 500 1,472.34, +1.66(0.11%)
NYSE Composite 8,733.10, +15.65(0.18%)
NASDAQ Volume 1,852,201,125
NYSE Volume 3,331,416,250
Combined NYSE & NASDAQ Advance - Decline: 3578-2829
Combined NYSE & NASDAQ New highs - New lows: 300-18
WTI crude oil: 93.28, -0.86
Gold: 1,683.90, +14.50
Silver: 31.53, +0.419

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